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By Diane CardwellTHE NEW YORK TIMES • Thursday February 21, 2013 5:24 AM

Automakers have long resorted to incentives such as zero-percent financing, rewards points and
rebates to inspire customer loyalty. Now, Honda is offering a different deal: inexpensive home
solar-power systems for customers.

Through a partnership with SolarCity, a residential and commercial installer, Honda and Acura
will offer their customers home solar systems at little or no upfront cost, the companies said
Tuesday. The automaker will also offer its dealers preferential terms to lease or buy systems from
SolarCity on a case-by-case basis, executives said.

To start, the offer is only available in states already served by SolarCity, which does not
include Ohio.

The deal, in which Honda will provide financing for $65 million worth of installations, will
help the automaker promote its environmental aims and earn a modest return, executives said. It
could also open the door for more corporate investment in solar-leasing companies, which has
largely been limited to a small cluster of banks to provide capital for their projects.

And SolarCity, one of the few clean-tech startups to find a market for an initial public
offering of its stock last year, will potentially gain access to tens of millions of new customers
through Honda’s vast lists of current and previous owners.

“When we partner with financial institutions, they aren’t promoting us to their customers, they’r
e essentially just providing us with capital,” said Lyndon R. Rive, SolarCity’s chief executive.
But with Honda, he said, the company is gaining “access to a broader customer base, and a customer
base that is conscious of the environment.”

SolarCity and a rival, Sunrun, were among pioneers of the approach, but players such as Clean
Power Finance and Vivint, a home-security company owned by the Blackstone Group, are also gaining
momentum.

In a typical arrangement, a company provides a system at little or no cost in exchange for a
long-term contract in which the customer pays a fixed fee for the electricity generated, set at
less than the customer would pay for power from the local utility. The solar price often rises over
the life of the agreement, which can last 20 years.

Honda approached SolarCity more than a year ago when it was looking for a partner to provide
solar-installation services for its hybrid- and electric- vehicle customers, said Ryan Harty,
American Honda’s assistant manager for environmental-business development. The company then decided
to expand to all its customers — a group it is defining “very, very broadly,” Harty said, to
include not just car owners but also those who have explored its websites.

The offer will be available in 14 states: Arizona, California, Colorado, Connecticut, Delaware,
Hawaii, Maryland, Massachusetts, New York, New Jersey, Oregon, Pennsylvania, Texas and Washington,
and the District of Columbia. A SolarCity spokesman said the company hopes to expand to Ohio but
has no timetable for doing so.

The two companies say they hope the joint venture leads to projects that integrate solar power
and electric-vehicle recharging for its customers.

The program will give Honda and Acura customers an extra $400 discount on top of SolarCity’s
normal promotions, which they can use to sweeten the terms of the solar contract, such as
eliminating the escalation of the monthly payment. Honda projects the fund can finance as many as
3,000 systems on homes and 20 for its dealers. If the program catches on, Honda plans to expand it.
Executives said they saw more immediate promise in cutting carbon emissions through solar power
than the electric vehicles it would sell.